Swiss Need To Pass Special Law Before UBS Can Turn Over Tax Evader List

Handing over a list of names has never been so internationally complicated.

The settlement agreement between the US and UBS that requires UBS to turn over the names of thousands of tax dodgers is having trouble surpassing legal hurdles.

WSJ: [The settlement] agreement risked falling apart after a Swiss court ruled in January that the deal violated Swiss law, where tax fraud is a crime, while tax evasion is not. The court found that the efforts by some UBS clients to hide from the IRS weren’t serious enough to constitute tax fraud.

In response, the Swiss government will package the UBS agreement as an ad hoc law and put it up for vote by Parliament. By making the U.S. agreement law in Switzerland, Bern is hoping to lay the legal groundwork for it to hand over UBS account details in cases of tax evasion, and not just tax fraud.

A vote on the bill is not expected until June. Those on the list can, of course, choose to come forward and work out their potential troubles with the IRS, or they can take the risk, watch the vote and see if their tax evading can remain a secret between them and the Alps.